Second, China has a special institution-the State Council Insurance Regulatory Commission, which is responsible for the supervision and management of insurance institutions. There is an insurance regulatory bureau in the local area. There are also self-regulatory associations in the insurance industry.
Third, the insurance company shall withdraw the deposit of 20% of the total registered capital and deposit it in the bank designated by the insurance supervision and administration institution of the State Council, which shall not be used except for paying off debts when the company is liquidated. An insurance company shall pay the insurance guarantee fund. The insurance protection fund shall be centrally managed and used as a whole under the following circumstances: (1) when an insurance company is revoked or declared bankrupt, it shall provide relief to the applicant, the insured or the beneficiary; (two) when an insurance company is revoked or declared bankrupt, it shall provide relief to the insurance company that accepts its life insurance contract according to law.
Fourth, China's insurance law has strict regulations on the use of funds by insurance companies. Article 106 stipulates that insurance companies must use funds steadily and follow the principle of safety. The use of funds by insurance companies is limited to the following forms: (1) bank deposits; (2) buying and selling bonds, stocks, shares of securities investment funds and other securities. (3) investing in real estate; (four) other forms of use of funds as prescribed by the State Council.
Fifth, if an insurance company engaged in life insurance business is revoked or declared bankrupt according to law, its life insurance contract and liability reserve must be transferred to other insurance companies engaged in life insurance business; If the transfer agreement cannot be reached with other insurance companies, the insurance company operating life insurance business designated by the State Council Insurance Regulatory Authority shall accept the transfer. If the life insurance contract and liability reserve specified in the preceding paragraph are transferred or accepted by the the State Council Insurance Regulatory Authority, the legitimate rights and interests of the insured and beneficiaries shall be safeguarded.
It is precisely because the insurance law has extremely strict regulations on the establishment, operation, bankruptcy, liquidation and other processes of insurance companies that the safety of insurance companies is higher than that of other types of companies, because insurance companies are related to people's livelihood issues and are closely related to the lives of ordinary people.
Therefore, insurance companies will still go bankrupt, but it is less likely than companies in other industries.
See the Insurance Law of People's Republic of China (PRC) for details.
Further reading: How to buy insurance, which is good, and teach you how to avoid these "pits" of insurance.